A company makes a single product with a sales price of 12 and a variable cost of 9. Fixed costs are 120,000 per month. The Company budget to sell 90,000 units of the product a month.

Calculate

a. number of units to break even

b. sales at break-even point.c. c/s ratio

d. What the budgeted profit per month

e. What number of units will need to be sold to achieve a profit of 20,000 p.a?

f. What level of sales will achieve a profit of 20,000 p.a?

g. If the taxation rate is 40% how many units will need to be sold to make a profit after tax is 20,000 p.a.?

h. Because of increasing costs the marginal cost is expected to fall to 6.50 per unit and fixed costs to 70,000 month. i. If the selling price cannot be increased what will be the number of units required to maintain a profit of 20,000 month? (ignore tax)

A company makes a single product with a sales price of 12 and a variable cost of 9. Fixed costs are 120,000 per month. The Company budget to sell 90,000 units of the product a month.

Calculate

a. number of units to break even

b. sales at break-even point.c. c/s ratio

d. What the budgeted profit per month

e. What number of units will need to be sold to achieve a profit of 20,000 p.a?

f. What level of sales will achieve a profit of 20,000 p.a?

g. If the taxation rate is 40% how many units will need to be sold to make a profit after tax is 20,000 p.a.?

h. Because of increasing costs the marginal cost is expected to fall to 6.50 per unit and fixed costs to 70,000 month. i. If the selling price cannot be increased what will be the number of units required to maintain a profit of 20,000 month? (ignore tax)